In it he says much of the past regulation of the financial sector has operated under the “wrong culture”.

He writes: “High cost regulation failed to protect consumers from misselling and other abuses. There must be greater clarity about the purposes of regulation. These should primarily be to sustain competition and choice for the consumer, to keep pricing honest, minimising implicit or explicit subsidies and to tackle crime fraud and economic rent-seeking.

“Like taxation, this is an area best kept to the achievement of relatively simple objectives but has in practice, been used as an instrument of social engineering.”

The TSC is currently investigating the accountability of both the Bank of England, which will be home to the Prudential Regulation Authority from 2013, and the incoming market regulator, the Financial Conduct Authority.

Tyrie says: “The accountability of the successor bodies to the FSA need careful review, certainly the arrangements in place for the FSA did not prove adequate.”